Federal Tax-Incentive Program for Low Income Neighborhoods Being Used to Develop Revolutionary Customized Anti-Cancer Therapeutic From the National Cancer Institute
WORCESTER, Mass. & ST. LOUIS, May 01, 2006 (BUSINESS WIRE) -- U.S. Bank (NYSE:USB) has provided the financing to help develop a
potentially life-saving therapeutic for non-Hodgkin's lymphoma,
marking the first time the New Market Tax Credit (NMTC) program has
been used to support a biopharmaceutical company. As part of a
financing arranged with Accentia Biopharmaceuticals, Inc.
(NASDAQ:ABPI), U.S. Bank purchased $4.6 million of NMTCs as part of an
investment in a subsidiary of Biovest International, Inc.
(OTCBB:BVTI). Biovest is an Accentia subsidiary developing the
revolutionary cancer treatment.
"To the best of our knowledge, this is the first use of this
federal program to enable the creation of high-paying
biopharmaceutical jobs in a qualifying census tract," said Dr. Frank
O'Donnell, Chairman and Chief Executive Officer of Accentia. "This
financing, the first of several, will immediately create additional
jobs that can't be moved off shore, as well as help catalyze the
economic redevelopment of the surrounding communities."
The NMTC program, under the auspices of the United States
Department of the Treasury, was established in 2002 to provide
incentive for investing in businesses located in "qualifying census
tracts," or areas with a median income below the poverty line. The
intent was to stimulate economic development, produce jobs, and bring
services to these "economically depressed" neighborhoods.
This initial NMTC-enhanced financing is considered to be the first
of several being discussed by Accentia and U.S. Bank for the benefit
of Biovest and its subsidiary. Biovest anticipates structuring
additional financings that could reach a total of $25 million in gross
NMTC-enhanced transactions before year end. Biovest believes that this
first financing will increase jobs, as well as expand the subsidiary's
production capacity at its operating facility in Worcester,
Massachusetts. The follow-on NMTC-enhanced financings are expected to
enable additional growth and open the potential for the addition of
manufacturing facilities in St. Louis, Missouri and/or Tampa, Florida,
or other cities with qualified low-income areas. Biovest is seeking
additional state and local subsidy support for such locations. The
initial investment sets in motion Accentia's goal to assist Biovest in
becoming a self-financed subsidiary.
Telesis, a nationally recognized leader in the economic
revitalization of inner cities, provided the NMTC allocation used in
this initial financing from its 2005 award of allocation authority.
Marilyn Melkonian, its President and Chief Executive Officer,
commented: "We are pleased to participate in this extremely important
use of NMTCs. Besides fulfilling their intended use, as envisioned by
Congress, to stimulate economic growth in disadvantaged areas of the
country by attracting private capital, this use of NMTCs provides the
added benefit of advancing an important new therapeutic in our fight
against cancer. Sooner or later, we are all likely to be stakeholders
in this fight against the number one killer in the United States."
Biovest is currently conducting its pivotal phase 3 study of
BiovaxID(TM) in patients with non-Hodgkin's lymphoma. The follicular
form of this cancer, though indolent, is most often lethal. But, as
Dr. Steve Arikian, Biovest Chairman and Chief Executive Officer,
explained, "The National Cancer Institute (NCI) developed this
therapeutic under an Investigational New Drug (IND) permit based on
groundbreaking pre-clinical research at Washington University Medical
Center in St Louis, and on human studies at Stanford University
Medical Center by Dr. Ron Levy. BiovaxID is the ultimate targeted
therapeutic in that it stimulates the patient's own immune system to
seek out and destroy only cancerous cells, with no collateral damage
to healthy cells.
Zack Boyers, Senior Vice President and Director of Historic and
New Market Tax Credits at St. Louis-based U.S. Bancorp Community
Development Corporation, said: "U.S. Bank is pleased to participate in
the development of life-saving technologies through this novel use of
NMTC-enhanced financing. We look forward to Biovest's continued
productivity and growth, along with the additional jobs the Company
will bring to the Worcester, Massachusetts community."
About U.S. Bancorp's Community Development Corporation
With assets of nearly $2 billion, U.S. Bancorp's Community
Development Corporation (USBCDC) is one of the largest New Market Tax
Credit (NMTC) investors in the country. USBCDC has participated in
over 75 separate transactions involving over $1.4 billion of NMTC
financings. It also makes equity investments in low-income housing and
historic tax credits in exchange for tax benefits and CRA investment
credits usable by U.S. Bank. Both are subsidiaries of U.S. Bancorp
(NYSE:USB), the sixth largest financial holding company in the United
States, with assets of $210 billion. The Company operates 2,430
banking offices and 4,941 ATMs, and provides a comprehensive line of
banking, brokerage, insurance, investment, mortgage, trust and payment
services and products to consumers, businesses and institutions. U.S.
Bancorp is the parent company of U.S. Bank. For further information,
About Accentia Biopharmaceuticals, Inc.
Accentia Biopharmaceuticals, Inc. is a biopharmaceutical company
focused on the development and commercialization of late-stage
clinical products in the therapeutic areas of respiratory disease and
oncology. Two of these products are SinuNase(TM) and BiovaxID(TM). The
Company's SinuNase product, in development to treat chronic sinusitis
(rhinosinusitis), is a novel application and formulation of a known
anti-fungal licensed from the Mayo Foundation for Medical Education
and Research. BiovaxID is a patient-specific anti-cancer vaccine
focusing on the treatment of follicular non-Hodgkin's lymphoma.
BiovaxID, which is being developed by Accentia subsidiary Biovest
International, Inc., is currently in a Phase 3 clinical trial. In
addition, Accentia's growing specialty pharmaceutical business, TEAMM
Pharmaceuticals, has a portfolio of currently marketed products plus a
pipeline of additional products under development by third parties.
For further information, visit the Company Web site at
About Biovest International
Biovest International, Inc. is a pioneer in the development of
advanced individualized immunotherapies for life-threatening cancers
of the blood system. Biovest is a majority-owned subsidiary of
Accentia Biopharmaceuticals, Inc., with its remaining shares publicly
traded. Biovest has a foundation in the manufacture of biologics for
research and clinical trials. In addition, Biovest develops,
manufactures and markets patented cell culture systems, including the
innovative AutovaxID(TM), which is being developed as an automated
vaccine manufacturing instrument and for production of cell-based
materials and therapeutics. Biovest's therapy for follicular
non-Hodgkin's lymphoma is currently in a Phase 3 pivotal clinical
trial at more than 20 major centers in the U.S., and is being
conducted under a Cooperative Research and Development Agreement
(CRADA) with the National Cancer Institute. For further information,
visit the Company Web site at www.biovest.com.
Statements in this release that are not strictly historical in
nature constitute "forward-looking statements." Such statements
include, but are not limited to, statements about future or follow-on
financings, availability of additional new market tax credits, Biovest
becoming a self-funded subsidiary, and any other statements relating
to products, product candidates, product development programs the FDA
or clinical trial process including the commencement, process or
completion of clinical trials or the regulatory process. Such
statements may include, without limitation, statements with respect to
the Company's plans, objectives, expectations and intentions and other
statements identified by words such as "may," "could," "would,"
"should," "believes," "consider""expects," "anticipates," "estimates,"
"intends," "plans" or similar expressions. Such forward-looking
statements involve known and unknown risks, uncertainties, and other
factors that may cause the actual results of Accentia and/or Biovest
or its subsidiary to be materially different from historical results
or from any results expressed or implied by such forward-looking
statements. These factors include, but are not limited to, risks and
uncertainties related to the progress, timing, cost, and results of
clinical trials and product development programs; difficulties or
delays in obtaining regulatory approval for product candidates;
competition from other pharmaceutical or biotechnology companies; and
the additional risks discussed in filings with the Securities and
Exchange Commission. All forward looking statements are qualified in
their entirety by this cautionary statement, and neither Accentia nor
Biovest undertakes any obligation to revise or update this news
release to reflect events or circumstances after the date hereof.
SOURCE: U.S. Bank
Lisa Clark, 608-877-7517 or 888-437-8620 (pager)
The Investor Relations Group, New York
(for Accentia Biopharmaceuticals)
Adam Holdsworth, 212-825-3210 (Investors)
Lynn Granito, 212-825-3210 (Public Relations)
Kevin Murphy, 212-825-3210 (Public Relations)